Oil prices higher after jobs report, gas dips

Traders work the crude oil options pit at the New York Mercantile Exchange Friday, May 6, 2011 ,in New York. Oil prices recovered after the U.S. government said the economy added 244,000 jobs in April. (AP Photo/Mary Altaffer)
— AP

Traders work the crude oil options pit at the New York Mercantile Exchange Friday, May 6, 2011 ,in New York. Oil prices recovered after the U.S. government said the economy added 244,000 jobs in April. (AP Photo/Mary Altaffer)
/ AP

NEW YORK 
Oil rose on Friday, boosted by a Labor Department report that showed surprising job growth in April.

Gas pump prices fell for the first time in 45 days following Thursday's big drop in oil and gasoline futures. The national average for a gallon of regular stayed just below $4 per gallon.

Gasoline has probably peaked ahead of the summer, analysts said. Even after a hiring spree last month that added 244,000 jobs, and put more commuters on the roads, analysts say that retail prices could decline to about $3.50 per gallon by June.

Gas had increased every day since March 23. It's been on an upward trend with oil over the past few months as the Libyan rebellion cut off the country's oil exports, the dollar fell and numerous refineries shut down due to power outages and other unexpected problems.

Gasoline prices also tend to rise every spring as refineries follow federal regulations to produce summer gasoline blends that are more expensive to make.

Andrew Lipow, president of Lipow Oil Associates in Houston, said problems with U.S. refineries have been resolved and gasoline supplies should start to grow this summer as refineries get back into gear.

"Combine those extra supplies with still rather high gas prices, and you're going to see continued pressure on gas prices throughout the summer" to fall, he said.

Gasoline gave up a tenth of a cent on Friday for a national average of $3.984 per gallon, according to AAA, Wright Express and Oil Price Information Service. Gas prices are still $1.06 more per gallon than they were a year ago. The average is also higher than $4 in 13 states and Washington, D.C.

The drop in gasoline comes after a week-long slide in oil. Oil has fallen about 11 percent since Monday amid growing concerns about the economy, a decline in gasoline consumption in the U.S. and a rising dollar. Oil is priced in dollars, and a stronger dollar makes it less attractive to buyers with foreign currencies, so prices fall.

Benchmark West Texas Intermediate for June delivery rose $1.27 to $101.07 per barrel on the New York Mercantile Exchange. In London, Brent crude added $2.40 at $113.20 per barrel on the ICE Futures exchange.

In other Nymex trading for June contracts, heating oil gained 5.53 at $2.9422 per gallon and gasoline futures picked up 7 cents at $3.1651 per gallon. Natural gas increased by 2 cents to $4.350 per 1,000 cubic feet.